Prior to the NAR settlement, which went into full effect on August 17th, 2024, representation worked as follows:

A seller would sign a listing agreement with a listing brokerage.  That listing agreement would contain a fee, usually a percentage of the final sales price, that would be paid to the listing brokerage at closing.  A portion of that fee would be paid to the buyer’s brokerage.  That portion was fully disclosed on the listing agreement.

All fees were, and remain fully negotiable.

This offering to the buyer’s brokerage was considered a unilateral offer of compensation, and was published in the MLS for all licensed brokerages and agents to be able to see.

On the buyer’s broker side, a buyer would enter into a written agency relationship and/or an exclusive buyer/broker agreement to work with an agent through the home buying process.  That buyer’s brokerage would be paid at closing by a portion of the funds agreed upon by the listing brokerage.

The buyer and seller would enter into a contract, agents would negotiate on their behalf, and everyone would achieve the final goal of closing the sale on the property.